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New Zealand house sales fell in June from a year earlier, led by properties of $400,000 or less, indicating the Reserve Bank's restrictions on low-equity loans are curbing demand at the cheaper end of the market.

Sales fell 6.1 per cent in June from the same month of 2013 to 5,763 and were down 12.3 per cent from May, according to the Real Estate Institute. The national median price rose $33,250, or 8.4 per cent, in the year to $427,250 and was 0.6 per cent lower than in May.

The central bank introduced restrictions on high loan-to-value mortgages last October to take the steam out of the housing market in Auckland and Christchurch which it said could stoke inflation. Since then the percentage of loans at LVRs of 80 per cent or more have fallen to 5.6 per cent in May, slightly up on the first months of the year, but well below October's 11.5 per cent rate.

The number of sales below $400,000 fell by 17 per cent in June, from a year earlier, following a 25 per cent annual drop recorded in May, which the REINZ said may be a reflection of the LVR restrictions. Sales of properties with a price tag of more than $1 million rose 19 per cent in the year, to make up 7 per cent of all sales in June, while sales between $600,000 and $999,999 rose 6.5 per cent in the year to make up 20 per cent of sales. Houses in the $400,000 to $599,999 price range rose 2.3 per cent compared to a year earlier to make up 28 per cent of total sales.

REINZ ceo, Helen O’Sullivan on house prices and where the market’s going.

The number of days to sell increased by five to 39 in June compared to a year earlier, one day longer than in May.

"Volumes continued to trend down in June, as they have done for the past several months," said REINZ chief executive Helen O'Sullivan. "We are starting to see a number of regions record annual falls in the number of sales at around 20 per cent, with only modest increases in those regions where sales numbers are rising."

The stratified median housing price index fell 0.3 from May. In Auckland, prices rose 1.6 per cent in the month on that measure, Christchurch fell 1.9 per cent and Wellington dropped 4.3 per cent. Over the year the national index increased 6.2 per cent, with the Auckland index 6.5 per cent higher, the Christchurch index up 5.5. per cent and the Wellington index declining 3.1 per cent.

The total value of residential sales, including sections, was $3.08 billion in June, compared to $3.06 billion a year earlier and $3.55 billion in May. For the 12 months ended June 30 the total value of residential sales was $39.58 billion.